Mitie sees slight fall in operating profits as revenue grows

The company said revenue growth should be in the range of 2% - 2.5% at around £2.2bn.

Chief executive Phil Bentley said the company had seen “limited impact” on the company in the wake of the collapse of sector peer Carillion, although he added this had raised “some fundamental questions about the outsourcing industry”.

Mitie said growth was driven by solid performances across all divisions with strong project work volumes in engineering services, increasing technology content in security and new business wins in care & custody.

Cleaning revenues had stabilised after recent declines, although this was partially offset by weak performances in property management and contracts losses in waste.

“We have seen limited impact on our operational business as a result of competitor or industry activity, and we remain fully focused on our transformation programme and the execution of our strategy,” Bentley said.

“Potential Brexit impacts are expected to be minimal, though could be felt in wage inflation and we have budgeted for increasing remuneration costs in full year 2018/19.”

Mitie said it expected average daily net debt to be £50m lower year-on-year as it continued to reduce its reliance on period-end invoice discounting.

“As a result of our more conservative approach and our commitment to normalising our balance sheet by reducing the company's reliance on non-committed facilities, we expect period end net debt to be £50m-£70m higher than last year,” the company said.